Are you a new business? Or an existing business interested in our services?Get a quote
HMRC has outlined changes to the VAT treatment of imported goods from 1 January 2021.
The changes will ensure that goods from EU and non-EU countries are treated in the same way and that UK businesses are not disadvantaged by competition from VAT-free imports.
From 1 January 2021, VAT on imported goods with a value of up to £135 will be collected at the point of sale as opposed to the point of importation. This means that UK supply VAT rather than import VAT will be due on goods.
Online marketplaces involved in facilitating the sale of imported goods will be responsible for collecting and accounting for the VAT, HMRC said.
Business-to-business sales not exceeding £135 in value will also be subject to the new rules. However, where the business customer is VAT registered in the UK and provides its valid VAT registration number to the seller, the VAT will be accounted for by the customer by means of a reverse charge.
The changes also involve the abolition of Low Value Consignment Relief, which relieves import VAT on consignments of goods valued at £15 or less.
More information on the changes can be found here.
Brearley & Co Accountants are pleased to offer a free, no obligation, initial consultation with one of our experts who will be happy to discuss your business needs and how we can help you.Contact